Warner Bros and MGM invest in Kabam

December 12th, 2012

Hollywood studio Warner Bros liked its partnership with social games publisher Kabam so much, it bought a stake in the company.

Kabam has confirmed a new funding round from Warner Bros and another Hollywood name, MGM, which will see Warner Bros Home Entertainment president Kevin Tsujihara taking a seat on Kabam’s board, while MGM boss Gary Barber becomes a board observer.

The size of the funding round hasn’t been disclosed. It follows several previous rounds: $4m in September 2007 and $5.5m in October 2009 – both taken when the company was called Watercooler – followed by $30m in January 2011 and another $85m in May that year.

Warner Bros has been working with Kabam on mobile games based on The Hobbit, around the upcoming trilogy of new films.

“As we worked with Kabam, it became clear that a closer, more strategic partnership made sense for us both. Kabam is a leader in the industry and we look forward to being a part of their continued growth,” Tsujihara tells TechCrunch.

Just as interesting, though, is what the exit strategy is for a social games company with a whopping $125m of funding under its belt. Once upon a time, Zynga would have seemed the likeliest acquirer for Kabam, but now it’s tempting to wonder whether Warner Bros or another studio would be tempted to bring the company fully in-house at some point.